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2013 (12) TMI 402 - AT - CustomsPenalty u/s 112 - Minimum penalty condition - Held that - Section 112 does not provide for any mandatory minimum penalty as has been done under Section 114A of the Customs Act, 1962. The limits prescribed under the said Section 112 are only the upper limits. In a case, where Rs. 10,000/- worth of goods have been absolutely confiscated, a penalty of Rs. 1,000/- amounting to 10% of the value of goods is adequate as the absolutely confiscated goods also vest in the government - decided against Revenue.
Issues:
- Imposition of penalty under Section 112(b) of the Customs Act, 1962. Analysis: The case involved the imposition of a penalty under Section 112(b) of the Customs Act, 1962. The original authority had confiscated goods valued at Rs. 10,000 and imposed a penalty of Rs. 1,000. The department appealed before the lower appellate authority, arguing that a minimum penalty of Rs. 5,000 should have been imposed under Section 112(b). However, the lower appellate authority rejected the appeal, stating that there was no mandatory minimum penalty of Rs. 5,000 under Section 112(b. The department then filed the present appeal contending that a minimum penalty of Rs. 5,000 was indeed prescribed under Section 112(b of the Act. The appellate tribunal noted that Section 112 of the Customs Act does not provide for any mandatory minimum penalty, unlike Section 114A of the same Act. The limits specified under Section 112 are considered as upper limits. In a situation where goods worth Rs. 10,000 were confiscated, a penalty of Rs. 1,000 (10% of the value of goods) was deemed adequate, especially since the confiscated goods become government property. Therefore, the tribunal found no grounds to entertain the department's appeal. This decision was in line with the ruling of the Larger Bench of the Tribunal in a prior case, which established that Section 112 does not mandate a minimum penalty. The tribunal cited the case of Commissioner of Central Excise v. Rama Wood Craft and Commissioner of Customs v. Jadu Ram Harijan to support this interpretation. Consequently, the tribunal dismissed the appeal filed by the department. The judgment was dictated and pronounced in open court.
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